Oyster Plaza Hotel v. Melivo
REITERATIONFacts
1. The Antecedents: Respondent Errol O. Melivo filed a complaint for illegal dismissal against petitioners Oyster Plaza Hotel, Rolito Go, and Jennifer Ampel. Melivo alleged that he was hired as a trainee room boy in August 2008, then as a probationary room boy in November 2008, with his contract expiring in March 2009. He was rehired as a room boy in April 2009 without a contract, and in September 2009, he was verbally informed by his supervisor, Ampel, that his contract was expiring and he should stop reporting for work. 2. Procedural History: Melivo filed his complaint with the National Labor Relations Commission (NLRC) on October 22, 2009. Summons were sent via registered mail and allegedly received by the petitioners. However, the petitioners failed to appear for conciliation conferences. Subsequent notices of hearings and orders were sent, with some returned unserved and others allegedly received by individuals not authorized to receive them. The Labor Arbiter (LA) proceeded to hear the case ex parte and ruled that Melivo was illegally dismissed, ordering reinstatement and payment of back wages, proportionate 13th month pay, and attorney's fees. The petitioners filed a motion to quash the writ of execution and appealed to the NLRC, arguing lack of proper service of summons and that Melivo was a fixed-term employee. The NLRC affirmed the LA's decision, finding substantial compliance with service rules and that Melivo was a regular employee. The Court of Appeals (CA) also affirmed the NLRC's decision, dismissing the petition for lack of merit. 3. The Petition: The petitioners seek review on certiorari of the CA's decision, raising three issues: (I) whether they were deprived of due process due to defective service of summons; (II) whether the CA erred in holding Melivo was illegally dismissed; and (III) whether Go and Ampel could be held solidarily liable with Oyster Plaza/Martyniuk Development Corporation (MDC). They argue that summons and notices were not properly served on authorized personnel, that Melivo was a fixed-term employee, and that Go and Ampel lacked the requisite malice or bad faith for solidary liability. The petition also questions the CA's affirmation of the NLRC's finding of illegal dismissal and the solidary liability of Go and Ampel.
Issue(s)
Whether the petitioners were deprived of their right to due process as they were not properly served with summons. Whether the Court of Appeals erred in holding that Melivo was illegally dismissed. Whether the Court of Appeals erred in finding petitioners Go and Ampel solidarily liable with Oyster Plaza/MDC.
Ruling
The petition is partly meritorious. The Court affirmed the CA's ruling on the issue of due process and illegal dismissal but modified the ruling on the solidary liability of Go and Ampel. Only Oyster Plaza Hotel/Martyniuk Development Corporation is ordered to reinstate Melivo and pay his monetary awards. The total monetary awards shall earn interest at the rate of 12% per annum from the date of termination until June 30, 2013, and 6% per annum thereafter until full satisfaction.
Ratio Decidendi
On the issue of due process and service of summons: The Court held that in quasi-judicial proceedings before the NLRC, procedural rules on service of summons are not strictly construed, and substantial compliance is sufficient. The service of summons by registered mail at the petitioners' place of business creates a presumption of due receipt, and the burden of proving irregularity was on the petitioners, which they failed to discharge. The failure to implead MDC was a procedural error that did not divest the labor tribunals of jurisdiction, as Oyster Plaza was owned and operated by MDC. The essence of due process is the opportunity to be heard, which the petitioners had before the NLRC and CA. Therefore, the petitioners were not denied due process. On the issue of illegal dismissal: The Court affirmed the CA's ruling that Melivo was illegally dismissed. Melivo's employment as a trainee in August 2008 could be considered his probationary period. Even if his re-hiring as a room boy in November 2008 was for a five-month probationary period until March 2009, he completed it. His subsequent re-hiring on April 7, 2009, made him a regular employee. The petitioners' contention that he was a project employee was untenable as the contract did not specify a project, and they failed to submit a termination report as required by D.O. No. 19. As a regular employee, Melivo could only be dismissed for just or authorized causes with notice and hearing, which the petitioners failed to provide. Hence, his dismissal was illegal. On the issue of solidary liability of Go and Ampel: The Court found that Go and Ampel could not be held solidarily liable with Oyster Plaza/MDC. A corporation's obligations are generally its own, and its officers are only liable in exceptional circumstances, such as malice or bad faith. Ampel's act of verbally informing Melivo of his termination was not malicious enough to warrant solidary liability. For Go, there were only bare allegations of his ownership and no substantial evidence of his participation in the illegal dismissal, nor any proof of malice or bad faith. Therefore, only Oyster Plaza/MDC should be adjudged liable.
Main Doctrine
In quasi-judicial proceedings before the NLRC and its arbitration branch, procedural rules governing service of summons are not strictly construed; substantial compliance is sufficient. The constitutional requirement of due process with respect to service of summons only exacts that the service be such as may reasonably be expected to give the notice desired. Once the service provided by the rules reasonably accomplishes that end, the requirement of justice is answered, the traditional notion of fair play is satisfied, and due process is served. Corporate directors and officers are held solidarity liable with the corporation for the employee's termination only when the same is done with malice or in bad faith.